A 40 Year Real Estate Veteran Once Taught Me a Profitable Lesson

Tampa property management company

About eight years ago, I attended a real seminar and ended up having dinner with several the speakers.  The topic of the hedge funds and private equity buying up tens of thousands of single family homes came up.  As an owner of a Tampa property management company and an active real estate investor, I had strong opinions on this subject.

The consensus was we thought the hedge funds and private equity were crazy and paying too high of prices.  We also thought they were ill equipped to manage all these assets in so many different markets

The only person who didn’t feel like they were crazy was an investor in his late sixties.  He explained that time will tell, but the behavior of these groups paying higher prices reminded him of his life.  Thirty years ago, he spent an enormous amount of time trying to find the best deals.  

This doesn’t mean you’ll have three times as much money in 30 years, if you paid cash for them, because of inflation.  However, if you use responsible leverage, and have the tenants pay off the mortgages, you will have a lot money.  In other words, paying cash for properties and waiting 30 years is not a good strategy to wealth, but getting great financing and buying quality assets is an overlooked option.

Thank You For Watching